There was a good article in the Daily Telegraph on Sunday (17/5/2015) explaining how Thatcher’s dream of a share owning population has become a nightmare. She tried to create a nation of investors by privatisations and regulatory changes to improve business competition but instead many companies have ended up being sold to foreign buyers.
Even worse there has been a collapse in private share ownership. The reported proportion of UK shares held by individuals has collapsed from 20% in 1994 to 11% today. In addition private shareholders are being stripped of their rights by the proliferation of the use of nominee accounts. The article rightly mentions the ShareSoc campaign against this and quotes us as saying this “fatally undermines your rights as an investor” which is spot on.
There were also some comments in the article from David Nicol of Brewin Dolphin on the need to encourage long term investing, as opposed to short term trading. He suggests reform of the capital gains tax system. It is indeed unfortunate that the system of indexing capital gains was dropped, and it would surely be wise to introduce a lower rate for longer term holdings. The market is becoming more and more speculative and it would be good to incentivise private investors to take a longer term view. With promises made not to raise income tax, there are rumours that the Government might raise capital gains tax rates instead but any changes in this area should encourage share ownership and savings, not deter it surely?
The article calls for Margaret Thatcher’s legacy not to be squandered. It would certainly be good to consider more reforms after her fashion. To read the full Telegraph article by John Ficenec go to: http://www.telegraph.co.uk/finance/11610490/Thatchers-dream-for-UK-investors-has-become-a-nightmare.html